The same law that sets boundaries on collectors' behavior
gives you the right to sue them when they ignore the rules. The U.S. Fair
Debt Collection Practices Act (FDCPA) imposes a $1,000 penalty on the collector
if they lose the case, plus reasonable attorney fees, as an incentive for them
to toe the line.

Going to court is the
last line of defense against abusive collections, but not an uncommon one,
lawyers said. "Suing noncompliant collectors is part of compliance -- that's
what Congress set up," said Richard Rubin, a consumer attorney in Santa
Fe, N.M., and former chairman of the National Association of Consumer Advocates
(NACA).

You will need an attorney to help prove that you were
wronged. One way to find a consumer
lawyer in your area is to search the "Find an attorney" section on
the NACA website.

Here are some common violations of the law, and tips from
consumer lawyers on how to prepare your case:

Calls won't stop.
Under the FDCPA, you may send a "cease communication" letter to the collector
that is supposed to shut off further calls. If calls continue, bring a copy of
the letter along with proof that you mailed it, such as a return receipt. Courts
are also accepting receipts for sent faxes. And bring an account of the calls you have
received, either from your telephone records or by making notes of the dates
and times of collection calls. "Lawyers love paper -- that's why they
became lawyers," said Richard Feferman, a consumer attorney in
Albuquerque, N.M.

Harassment. The
law doesn't say how many phone calls constitute harassment, but courts
generally rule that frequent, consecutive calls show intent to harass, Feferman
said. Also, calls between 9 p.m. and 8 a.m. are forbidden. Most people automatically
keep records of calls in their cellphone call history or through caller
identification features of their home phone.

Harm to reputation. Calls to "third parties"
such as neighbors or family members are permitted only to confirm your home
address, phone number or place of employment. However, debtors often complain that
collectors use these calls to shame them or as a pressure tactic. It's a violation
for a collector to tell a third party about your debt or ask them to relay a
message to you. Document these violations with a written statement from the
person and a copy of any message they took from the collector.

Debts not owed. If
a collector won't drop demands for amounts that you don't owe, gather account
records and receipts that show the correct balance. If the demands involve an
account you never had, confirm this with copies of your credit reports. Debts
erased by bankruptcy are also covered under this protection, but if you have
already been through that process, Feferman recommends getting help from your
bankruptcy attorney to stop collection attempts. "That's why you file
bankruptcy, to get these people off your back," he said.

False threats. Debtors often complain about threats that they are
about to be hauled into court for nonpayment or even thrown in jail. Usually,
the collector lacks the authority to follow through, making this a violation. Real
collection lawsuits typically begin with service of court papers, not a phone
call. Proving what was said on the phone is often difficult, but it needn't be,
Rubin said. Consumers have a right to record their calls in every state, as
long as they tell the caller that the tape is rolling. Some states don't
require this notification, but Rubin recommends it anyway, as collectors may think
twice about what they say when the "record" button is on. "Having a tape recording saying you're
going to jail is the gold standard in the litigation business," he said.

Published: November 9, 2012

Join the discussion

We encourage an active and insightful conversation among our users. Please help us keep our community civil and respectful. For your safety, do not disclose confidential or personal information such as bank account numbers or social security numbers. Anything you post may be disclosed, published, transmitted or reused.

If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.

The editorial content on CreditCards.com is not sponsored by any bank or credit card issuer. The journalists in the editorial department are separate from the company's business operations. The comments posted below are not provided, reviewed or approved by any company mentioned in our editorial content. Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.

Did you like this story? Then sign up for CreditCards.com’s weekly e-newsletter for the latest news, advice, articles and tips. It's FREE. Once a week you will receive the top credit card industry news in your inbox. Sign up now!